First, hire a lawyer. Second, read through your EULA with your lawyer translating. Third, weep.
Seriously, I think we need consumer legislation to protect us from EULAs. The are so lengthy and incomprehensible that it is unreasonable to assume the average consumer can read and comprehend all the contractual requirements within.
Also, from what I have been reading, the issue deals with different copyright laws. In the US, these books are still under copyright (mainly due to congress constantly extending the time span that copyrights exist). Fortunately for so many other countries, these works are in the public domain as their copyrights expired. Amazon "sells" access to a kindle-compatible version of these public domain books for $0.99. Thus the conflict - the US consumer should not have been able to buy this cheap version but there is a more expensive version.
My understanding is that you are only getting a license to the book, but there are some poor terms which leaves some question as to what you are actually buying. For example, you are allowed to put a *permanent copy* on your computer - but then again they have the right to revoke the license and refund your money.
I know, its really a mess - and part of the bigger IP picture that we see being fought each day with frivolous lawsuits, poorly considered patents, accusations of plagiarism for writing about commonly accepted ideas, and the image fiasco with wikipedia.
Oh, here's a kicker for you Kindle book buyers - did you know there are limits to the installs? Apparently one customer who wiped and reloaded their device found out they could no longer download their books. After a lot of back-and-forth with customer service, the story changed from limited downloads to unlimited downloads but only to a limited number of unique devices. So, upgrade your Kindle and use your iPod (or whatever) to read your books, and you may suddenly find you do not have a license to put it on your next upgrade. Most publishers limit it to 6-8 downloads to unique devices, but some allow only 1 device. The kicker? They don't publish this limit anywhere when buying it. That is like buying a DVD and finding out it will only play in the first 1-8 devices you use it in, but not knowing if it is 1 or 8!
Myself, I'll stick to open formats, things without DRM, and using my tablet pc as my "eReader". Heck, I could even use a Kindle with these devices - but I don't think I'd want to support Amazon which is pro-DRM.
Final thought - someone at the New York Times posted a comment to this effect: if Amazon has the power to pull out books from your system due to copyright infringement, what happens if a government decided to ban a book as offensive? Would Amazon comply with the new ban and pull the book from your library?
Oh, and if you are going to pirate a book, do me a favor - buy a paper copy and use a camera to make your e-copy. Help keep good books being printed. Thanks.